The right corporate management structure can help you manage your business effectively. A company should consider the type of structure that best is suited to its business goals and industry. It should also evaluate its existing structure and make any necessary changes. Any changes must be properly communicated to employees, especially in the event that the company is going through a reorganization. If not, it could cause a sense of cynicism among employees.
The top-tier of a corporation is made up of the executive officers and the board including the chief executive (CEO). The CEO is responsible for the day-to-day business operations and is in charge of the majority of legal business activities. The shareholders are also a part in the corporate structure even while they’re not involved in the day-to-day business operations. They are accountable for budgets and have the power to vote on major decisions.
Staff managers are below the director’s board. They collaborate with executives at higher levels to establish policies. Staff managers are grouped into functional departments, which allows departments to operate on their own and improves efficiency for a specific business function. They can also be placed in divisional departments. This is ideal for companies with a variety of products and need to respond quickly to market shifts.
A circular structure is similar to a functional or divisional structure. However instead of a chain of command running vertically, this structure functions horizontally across departments. It’s a visualizing acquisition processes great strategy to promote collaboration and communication between departments. It can also foster the spirit of teamwork and trust among employees.